Because the cryptocurrency market is notoriously volatile, traders should be cautious in times like these. Large fortunes can be lost in just a few hours or days if the trend changes.
Charlie Burton, a veteran trader and co-founder of Ezeetrader says this is the time when traders need to establish a set of rules to follow when emotions start to boil. “We are all flawed, fallible human beings, especially when it comes to the markets,” he said.
“We are naturally affected by fear or greed to one degree or another.” We need some rules but I also believe that visualization is a good thing.
These rules could include things such as the percentage loss investors can place a stop loss at, the maximum amount of portfolio one will allow to trade and the setting of sell orders for investments.
It is essential to have a lot of self talk. “If I take this trade and it fails, will I be upset about myself?” This is a good line to stop me jumping into trades I shouldn’t. You should do your research before making any investment or trading decision.